TaxTMI 
TaxTMI 
2024 (4) TMI 1385
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....ERIM APPLICATION NO. 1978 OF 2022 WITH INTERIM APPLICATION (L) NO. 34756 OF 2022 WITH INTERIM APPLICATION (L) NO. 21646 OF 2023 IN WRIT PETITION NO. 2681 OF 2021 WITH WRIT PETITION NO. 2843 OF 2021 WITH INTERIM APPLICATION NO. 1029 OF 2020 WITH INTERIM APPLICATION (L) NO. 6665 OF 2020 IN WRIT PETITION NO. 2843 OF 2021 WITH WRIT PETITION NO. 2624 OF 2021 WITH INTERIM APPLICATION (L) NO. 24248 OF 2022 IN WRIT PETITION NO. 2624 OF 2021 WITH WRIT PETITION NO. 3338 OF 2021 WITH INTERIM APPLICATION NO. 1871 OF 2023 WITH INTERIM APPLICATION (L) NO. 10422 OF 2024 IN WRIT PETITION NO. 3338 OF 2021 WITH WRIT PETITION NO. 3775 OF 2021 WITH INTERIM APPLICATION (L) NO. 23397 OF 2022 WITH INTERIM APPLICATION NO. 1017 OF 2023 WITH INTERIM APPLICATION NO. 3904 OF 2023 IN WRIT PETITION NO. 3775 OF 2021 WITH WRIT PETITION NO. 3952 OF 2021 WITH INTERIM APPLICATION (L) NO. 1893 OF 2022 WITH INTERIM APPLICATION (L) NO. 14840 OF 2023 WITH INTERIM APPLICATION (L) NO. 3750 OF 2024 IN WRIT PETITION NO. 3952 OF 2021 WITH WRIT PETITION (L) NO. 18651 OF 2021 WITH INTERIM APPLICATION NO. 1654 OF 2023 IN WRIT PETITION (L) NO. 18651 OF 2021 WITH WRIT PETITION NO. 46 OF 2022 WITH INTERIM APPLICATION (L) NO. 17419....
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....PETITION (L) NO. 7310 OF 2022 WITH INTERIM APPLICATION (L) NO. 18195 OF 2022 WITH INTERIM APPLICATION NO. 1600 OF 2022 WITH INTERIM APPLICATION (L) NO. 36519 OF 2022 WITH INTERIM APPLICATION NO. 107 OF 2024 WITH INTERIM APPLICATION NO. 964 OF 2024 IN WRIT PETITION (L) NO. 7310 OF 2022 WITH WRIT PETITION NO. 2357 OF 2023 WITH INTERIM APPLICATION NO. 2348 OF 2023 IN WRIT PETITION NO. 2357 OF 2023 WITH WRIT PETITION NO. 2789 OF 2023 WITH INTERIM APPLICATION (L) NO. 19182 OF 2022 WITH INTERIM APPLICATION (L) NO. 17823 OF 2022 WITH INTERIM APPLICATION (L) NO. 12161 OF 2023 IN WRIT PETITION NO. 2789 OF 2023 WITH CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 2200 OF 2021 WITH INTERIM APPLICATION NO. 342 OF 2022 IN WRIT PETITION NO. 2200 OF 2021 WITH WRIT PETITION NO. 4356 OF 2021 WITH WRIT PETITION NO. 5450 OF 2021 WITH WRIT PETITION (ST) NO. 6654 OF 2022 WITH INTERIM APPLICATION NO. 3220 OF 2022 WITH INTERIM APPLICATION NO. 13457 OF 2023 WITH INTERIM APPLICATION NO. 13458 OF 2023 WITH INTERIM APPLICATION NO. 17522 OF 2023 WITH INTERIM APPLICATION (ST) NO. 17368 OF 2023 IN WRIT PETITION (ST) NO. 6654 OF 2022 Jubin K Thakkar, Pravin Mehta, Purushottam Chagganlal Mandhana, Biharilal Cha....
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....d Bank, Kotak Mahindra Bank, Bank of India, Export Import Bank of India, State Bank of Hyderabad, Indian bank, SBI CAP Trustee Company Ltd. FRRO, Bureau of Immigration, The Chief Manager, Bank of Baroda And Harbhajan Singh, Rajkumari Singh Versus Bureau of Immigration, Ministry of Home Affairs And Rihen Harshad Mehta Versus The Additional Commissioner of Police, The State of Maharashtra, MD & CEO, Bank of Baroda And Samir Pravin Shah Versus The Bureau Of Immigration, Ministry of Home Affairs, Government of India, Chetan Ramniklal Shah, Hema Chetan Shah Versus Bank of Baroda (Dena Bank), Mumbai. G.S. PATEL AND MADHAV J JAMDAR, JJ For the Petitioners : Dr Birendra Saraf, Senior Advocate, with Sanchit Bhogale, Anirudh Purushothaman, i/b Parth Shah. For the Petitioners in some matters : Ms Gulnar Mistry, with Submit Chakrabarti, Shantam Mandhyan, Apurva Pawar & Abhay Jariwala, i/b Vidhii Partners. Mr Dharam Jumani, with Suraj Iyer, Gauri Joshi, Mihir Nerurkar, i/b Ganesh & Co. For the Respondent : UoI Mr Anil Singh, ASG, with Rui Rodrigues, YR Mishra, YS Bhate, DA Dube, Sandesh Patil, Aditya Thakkar, DP Singh, Ashish Mehta, Ajinkya Jaibhave, Savita Ganoo, Deepak Shukla, Smi....
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....typically deployed to prevent the individual in question from travelling overseas. An almost invariable feature is that the individual has no prior notice of the issuance of the LOC, and is not even given a copy of the LOC. She or he is merely told that there is such an LOC issued by a particular bank and the person cannot, therefore, be allowed to board the flight. 8. Various courts across the country, including our own, have passed interim or final orders staying the LOCs and allowing travel. As far as we know, there is no decision yet on the constitutional validity of the OMs that permit public sector banks ("PSBs") to request the issuance of such LOCs. 9. In one voice, the Petitioners say that the amendments to the OMs that allow PSBs to trigger or request such LOCs are all ultra vires Article 21 of the Constitution of India. These are, they say, without the authority of 'law' as understood under Article 13 of the Constitution of India. Mere executive instructions cannot trammel fundamental rights. Besides, the entire field of regulating travel is fully occupied by a statute, namely the Passports Act, 1967 ("the Passports Act"). 10. The principal contest comes ....
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....ted inter alia by Ms Gulnar Mistry and Mr Dharam Jumani. Of necessity, we required counsel not to replicate arguments already made. We appreciate the cooperation. Mr Singh, learned ASG, addressed on behalf of the Union of India (including the MHA and the Bureau of Immigration or "BoI"). Ms Rathina Maravarman, and Ms Manjiri Parasnis and Mr Prakash Shinde represented various respondent banks defending the OMs and the LOCs. The title of this judgment only notes the appearances of the principal counsel. The appearances in the other matters in the group will be shown in a separate order. We will not entertain any applications for speaking to the minutes of the principal judgment to correct appearances. B. THE ORIGINS AND EVOLUTION OF LOOK OUT CIRCULARS AND THE OFFICE MEMORANDA; EARLY CASES 14. The OMs are notoriously difficult to trace. There is no complete compendium available in print or online. Early in the hearing, we were surprised by an initial resistance from Mr Singh, learned ASG, to make available a complete set of the OMs. He stopped short of invoking privilege or the Official Secrets Act and quite correctly did not pursue the objection much further, correctly taking th....
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....the first challenge before the Delhi High Court in Vikram Sharma v Union of India. [(2010) 171 DLT 671] The Court was asked to decide if statutory bodies like the National Commission of Women (NCW) could request the issue of LOCs. The Delhi High Court held that statutory bodies like the NCW did not fall under the ambit of "authorities concerned"; the request for the issuance of a LOC had to come from either the Central or the State Government. The Court held that instead, statutory bodies like the NCW and NHRC could only notify law enforcement, which could then request the issuance of a LOC. 21. In a related case, Sumer Singh Salkan v Asst. Director & Ors, [ILR (2010) VI Delhi 706] the Delhi High Court answered four questions raised by a lower court on LOCs. Its answers were meant to serve as general guidelines for the agencies issuing LOCs: (a) Recourse to LOCs could be taken by an investigative agency only in cognizable offences under the Indian Penal Code, 1860 or other penal laws, where the accused was deliberately evading arrest or not appearing in the trial court despite non-bailable warrants and other measures to compel attendance, and where there was a likelihoo....
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....from India could be denied- if the concerned authorities received inputs that the departure of a person from India is detrimental to the sovereignty or security or integrity or that the same is detrimental to the bilateral relations with any country or to the strategic and/or economic interests of India ... (Emphasis added) 25. Thus, this 2017 amendment introduced the 'economic interests of India' in the 'exceptional case' category. 26. In 2018, the MHA released several OMs making significant amendments to the 2010 OM. The 19th September 2018 OM ("2018 OM-I") empowered officers in the Serious Fraud Investigation Office (SFIO) to approve the opening of LOCs under Clause 8(j). 27. A communication dated 4th October 2018 issued by the Ministry of Finance requested the MHA to include the following in the category of authorities who could trigger a LOC request in clause 8(b), by adding entry (xlv): "(xv) Chairman (State Bank of India) /Managing Directors and Chief Executive Officers (MD & CEOs) of all other Public Sector Banks." 28. On 12th October 2018, the MHA accepted the request and made the addition ("2018 OM-II") noted above. This is....
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....st for opening LOC at any point of time if departure of a particular person from India is perceived to be detrimental to the 'economic interests of India' or if the departure of such person from India 'ought not be permitted in the larger public interest'. Therefore, Department of Financial Services may suitably advise all Public Sector Banks to the effect that the competent authorities of Public Sector Banks may make a request for opening LOC against a person at any point of time without waiting for the investigation agencies to take action for opening LOC. 5. At the same time, wherever the investigation agencies have already registered cases, they (investigation agencies) should not refer the case back to the Bank. The investigation agencies should themselves take pro-active steps to open an LOC wherever so required. The investigation agencies are also being suitably advised separately. 6. Further, the officers of financial institutions and the officers of investigating agencies are expected to act in tandem and ensure that wherever required LOCs are opened in time to prevent the departure of persons from India against the economic interest of the country or aga....
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.... x. An officer not below the level of Superintendent of Police in National Investigation Agency; or xi. Assistant Director of Enforcement Directorate; or xii. Protector of Emigrants in the office of the Protectorate of Emigrants or an officer not below the rank of Deputy Secretary to the Government of India; or xiii. Designated officer of Interpol; or xiv. An officer of Serious Fraud Investigation Office (SFIO), Ministry of Corporate Affairs not below the rank of Additional Director (in the rank of Director in the Government of India); or xv. Chairman/ Managing Directors/ Chief Executive of all Public Sector Banks. (C) LOCs can also be issued as per directions of any Criminal Court in India. In all such cases, request for opening of LOC shall be initiated by the local police or by any other Law Enforcement Agencies concerned so that all parameters for opening LOCs are available. (D) The name and designation of the officer signing the Proforma for requesting issuance of an LOC must invariably be mentioned without which the request for issuance of LOC would not be entertained. (E) The contact details of the O....
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....e the LOC if any, immediately after such a review. The BOI should contact the LOC Originators through normal channels as well as through the online portal. In all cases where the person against whom LOC has been opened is no longer wanted by the Originating Agency or by Competent Court, the LOC deletion request must be conveyed to BoI immediately so that liberty of the individual is not jeopardized. (K) On many occasions, persons against whom LOCs are issued, obtain Orders regarding LOC deletion/ quashing/ suspension from Courts and approach ICPs for LOC deletion and seek their departure. Since ICPs have no means of verifying genuineness of the Court Order, in all such cases, orders for deletion/quashing/ suspension etc. of LOC, must be communicated to the BoI through the same Originator who requested for opening of LOC. Hon'ble Courts may be requested by the Law Enforcement Agency concerned to endorse/convey orders regarding LOC suspension/ deletion/ quashing etc. to the same law enforcement agency through which LOC was opened. (L) In exceptional cases, LOCs can be issued even in such cases, as may not be covered by the guidelines above, whereby departure of ....
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....s over, a deletion request shall be sent by the Originator immediately to the BoI. vi. The Originator must respond promptly whenever the subject/ likely match is deleted at the ICP. The confirmation regarding the identity of the subject and action to be taken must be informed immediately to the ICP. vii. The BoI would form a team to coordinate matters regarding the LOC. This team would contact the LOC issuing agencies to get the status of LOC updated. viii. Each LOC Originating Agency referred in para 6 (B) above will appoint a Nodal officer as indicated in Annexure-I for coordination/updation of LOC status with BoI. The said team of BoI [as mentioned in para 6(N) (vii)] would remain in constant touch with this Nodal Officer. (Emphasis added) 32. We will return to a closer analysis of these consolidated guidelines a little later in this judgment. C. ILLUSTRATIVE USE OF A LOOK OUT CIRCULAR AT THE INSTANCE OF A PUBLIC SECTOR BANK 33. We will use the facts in the lead matter, Writ Petition No 719 of 2020 (Viraj Chetan Shah v Union of India & Anr) as typical, and for illustration only. The other cases are all variations on a similar theme as the c....
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....n issued in violation of the Guidelines and this Hon'ble Court be pleased to quash and / or set aside the Impugned Lookout Circular; E. that this Hon'ble Court be pleased to issue a Writ of Mandamus or a Writ in the nature of Mandamus or any other appropriate Writ, order and/or direction commanding Respondent Nos. 1 and 2 or any one or more of them as this Hon'ble Court deems fit and proper to forthwith refrain from acting upon and/or in pursuant of the Impugned Lookout Circular and/or the impugned actions in any manner whatsoever; 36. The sequencing of the OMs is confusing, apart from the sheer difficulty in accessing them. For that reason, we will overlook the exact wording of prayer (a1), for the amendment - as noted above - was not "Chairman (State Bank, of India) / Managing Directors and Chief Executive Officer (MD & CEOs) of all other Public Sector Banks" but "Chairman/ Managing Directors/ Chief Executive of all Public Sector Banks". 37. Shah's version of the facts runs like this: (a) With a bachelor's degree in commerce from Mumbai University in 2008, Shah was appointed to the Board of Directors of P&S Jewellery Ltd on 2nd January ....
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....sion. Shah says he learnt of this from the UBI Affidavit in Reply to his Writ Petition. (k) On 7th April 2017, the DRT granted Paresh and his son Sahil permission to travel abroad after submitting their itinerary and disclosing assets. (l) Meanwhile, Shah travelled in and out of India without restraint. At page 15 of the Writ Petition he lists 12 dates of entry and exit between 27th December 2015 and 10th May 2019. (m) On 29th May 2017, the NCLT admitted the company's petition for an order of liquidation under Section 10 of the Insolvency & Bankruptcy Code, 2016. The NCLT passed an order of liquidation on 30th July 2018. (n) On 20th May 2019, UBI declared Shah a 'wilful defaulter' ostensibly invoking some guidelines or circulars of the Reserve Bank of India. Shah says he was not served with a notice. (o) On 2nd June 2019, Shah took up a new job with Ellington Capital Ltd as a financial analyst. (p) On 9th July 2019, the State Bank of India asked UBI to issue a LOC against the company's directors. UBI did SO. (q) On 9th August 2019, Shah returned to Mumbai. He was to leave on 13th August 2019 to return to....
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....dit report and found from this in August 2015 - at about the time Shah moved to the UAE - that Shah's family was routinely undertaking transactions with trade associates and corporates in a discernible pattern, routing funds through banks outside the consortium; and many of these transactions were with family-founded enterprises in UAE/Dubai sharing common shareholding and management structures. 40. In the legal proceedings before the DRT, it was not just Paresh and Shah who were defendants. So too were Shah's father, grandfather and paternal cousins. Those proceedings were served on all defendants, and there is, UBI says, an affidavit of service to this effect. Interestingly, the defendants except Shah filed an interim application before the DRT to vacate its ex parte order of 3rd March 2017. That IA was never moved; it is or at the time of the Affidavit in Reply was still pending. Instead, the defendants applied to the DRT for leave to travel abroad and obtained permissions periodically. UBI essentially says Shah knew all this, or cannot have been unaware of it, but he chose to 'stay under the radar in the hope that out of sight would be out of mind': he went i....
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....is wholly uncanalised. (e) The conferment on such power only on PSBs to the exclusion of other banks is invidious discrimination. It creates a class within a class and there is no nexus with the object sought to be achieved, viz., speedy recovery of dues. PSBs cannot be given special treatment. (f) Fundamental rights cannot be curtailed by executive action. 44. Our purpose in setting out these facts in some detail is not to adjudicate them. Rather, it is to provide a more or less general context, for every case is, with some variations, in much the same vein. Nothing is to be gained by delving into individual facts; that would only distract from the issues at hand. To be sure, these facts raise questions of law (whether a continuing and unconditional personal guarantee can ever be side-stepped in this fashion by a resignation from the Board of Directors of the borrower company), and matters of equity. 45. We also repel the endeavour (at least in pleadings) to elicit some sort of sympathy and to decide these matters on that basis. Justice is certainly to be tempered with compassion, but that compassion is for those deserving of it. Idle and faux sympathy can ....
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....pecifically: no matter what the wording of the prayers, we have not been asked to consider a broader challenge to the OMs issued by authorities other than the high-ranking officers of PSBs, nor the question of issuance of LOCs in any other context. The entirety of the discussion has been in relation to LOCs issued by PSBs under the amended OMs against defaulters - or alleged defaulters - of borrowings from PSBs. 51. It is important to note this because the breadth of the arguments and submissions by the Petitioners is conceivably wider. There is a risk of expanding these arguments to an overall challenge to the OMs, for many submissions, especially those regarding unconstitutional abridgment of the fundamental right to life guaranteed under Article 21 of the Constitution of India, could well be applied to such a broader challenge. Before us, however, all have confined themselves to the amended OMs that allowed the senior officers of PSBs to request the issuance of LOCs. Had it been otherwise, the responses especially from the Union of India would no doubt have been very differently placed. 52. The challenges before us must also be understood in context. There is simply no fac....
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....ing to a procedure established by law; and a failure to abide by mandated minimum procedural norms; unreasonableness; arbitrariness; want of proportionality), and (iii) Arbitrary, unreasonable and disproportionate in equating the financial interest of a public sector bank with the "the economic interests of India". 54. For quick reference, we reproduce the three clauses in question immediately: 6. The existing guidelines with regard to issuance of Look Out Circulars (LOC) in respect of Indian citizens and foreigners have been reviewed by this Ministry. After due deliberations in consultation with various stakeholders and in suppression of all the existing guidelines issued vide this Ministry's letters/ O.M. referred to in para 1 above, it has been decided with the approval of the competent authority that the following consolidated guidelines shall be followed henceforth by all concerned for the purpose of issuance of Look Out Circulars (LOC) in respect of Indian citizens and foreigners :- (B) The request for opening of LOC must invariably be issued with the approval of an Originating agency that shall be an officer not below the rank of- .....
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....c note prepared under his guidance by Mr Aditya Thakker. We do so because, after all, the OMs are issued by the Union Government and none is better placed to explain the origin and need for the OMs. 58. Mr Singh took us to the Union of India's Affidavit in Reply dated 24th January 2022 (filed in Writ Petition No 3338 of 2021, Karen Baheti & Anr v Union of India & Ors). In paragraph 2, the Union of India explains that the national security, safety and sovereignty concerns demanded the establishment of an agency to monitor the entry and exit of persons through international check-posts by air, sea and land. This was not restricted to Indian citizens. In 1971, the MHA set up the Bureau of Immigration as a border control agency. It checks and monitors the entry and exit of all travellers across all international check posts in India. Anyone - Indian or foreign - who crosses the country's national frontiers must pass through a mandatory immigration check. The check posts are manned by BoI officers. The process includes passport, citizenship status and visa checking. These check posts are the first entry point into the country and last exit point. Without this, the Affidavit s....
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....n originating agency. In other words, the OMs are not substantive law at all. They are internal instructions and provide the necessary guidelines and framework, inter alia as required by the two Delhi High Court decisions in Vikram Sharma and Sumer Salkan. Mr Singh emphasizes clauses 8(e) and 8(f) of the OMs (from the consolidated OM of 27th October 2010 corresponding to clauses 6(F) and 6(G) of 22nd February 2021 OM): e) Care must be taken by the originating agency to ensure that complete identifying particulars of the person, in respect of whom the LOC is to be opened, are indicated in the Proforma mentioned above. It should be noted that an LOC cannot be opened unless a minimum of three identifying parameters, as given in the enclosed Proforma, apart from sex and nationality, are available. However, LOC can also be issued if name and passport particulars of the person concerned are available. It is the responsibility of the originator to constantly review the LOC requests and proactively provide additional parameters to minimize harassment to genuine passengers. f) The legal liability of the action taken by the immigration authorities in pursuance of the LOC re....
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....clearance to the international passengers subject to any LOC action against him/her, which is maintained in the system, as requested by the LOC originating agency. 12. I say that as per the O.M dated 27.10.2010, the legal liability of the action taken by the immigration authorities in pursuance of the LOC rests with the originating agency and not Bureau of Immigration .... 15. I say that the Bureau of Immigration, being the Border Control Agency is only the Custodian of LOCs, who maintains LOCs and takes action against LOC subjects at Immigration Check Posts at the behest of the Originating Agency. Further, the legal liability of the action taken by immigration authorities in pursuance of LOC rests with the originating agency. 19. I say that, practically, LOC is a process started by the Bureau of Immigration on a communication received from an authorised Government Agency with reference to a person who is wanted by that agency for, inter-alia, fulfilment of a legal requirement, to secure arrest of person evading arrest, to nab proclaimed offenders or to facilitate court proceedings by securing presence of under trials who are on bail. It is further submit....
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....ties of the Bureau of Immigration. (Emphasis added) 69. The stand of the Union of India is abundantly clear. There is no ambiguity about it. Based on these averments, Mr Singh submits that the OMs do not per se restrict the right to travel abroad or any fundamental right at all. The OMs are merely guidelines and a framework to establish a consistent protocol for originating agencies to seek the assistance of the border control agency. Only the originating agency is responsible and liable for these action and the need for them. An originating agency may request different types of action: (a) Detain and Hand over to Local police (in cognizable offence); (b) Detain and Inform (wait for next instructions); (c) Prevent Entry into India (Only in case of foreigners); (d) Prevent Departure from India (for both Indian and foreigners); (e) Inform only arrival/departure (Discreet watch); (f) Customs LOC (Inform Customs authority on Entry/Exit for their follow up) (g) Allow Departure only if permitted by Court, else Exit not allowed (Usually being ordered by the Courts in India); 70. Mr Singh maintains that it is the domai....
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....ravel abroad. In Satwant Singh Sawhney v Asst Passport Officer, [AIR 1967 SC 1836 : 1967 SCC OnLine SC 21 : (1967) 3 SCR 525] the Supreme Court said Article 21 includes the right to travel abroad and to curtail or restrict this right, there must be procedure enacted by statute. Some of the observations in Satwant Singh seem oddly prescient today - for these are the very arguments on behalf of the public sector banks before us. K. Subba Rao, C.J .- Satwant Singh Sawhney, the petitioner, is a citizen of India. He carries on the business of Importer, Exporter and Manufacturer of automobile parts and engineering goods in the name and style of Indi- European Trading Corporation. He also carries on another business in engineering goods in the name of "Sawhney Industries". For the purpose of his business it is necessary for the petitioner to travel abroad. From the year 1958 he was taking passports for visiting foreign countries in connection with his business. On December 8, 1966 he obtained a regular passport from the Government of India which is valid upto March 22, 1969. So too, on October 27, 1965 he obtained another passport which was valid upto March 22, 1967. On August 31....
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....and return to India is part of personal liberty guaranteed under Article 21 of the Constitution. (2) Refusal to give a passport or withdrawal of one given amounts to deprivation of personal liberty inasmuch as, (a) it is not practically possible for a citizen to leave India or travel abroad or to return to India without a passport, (b) instructions are issued to shipping and travel companies not to take passengers on board without passport, (c) under the Indian Passport Act re-entering India without passport is penalized. (3) The deprivation of personal liberty is not in accordance with the procedure established by law within the meaning of Article 21, as admittedly there is no law placing any restrictions on the citizens of the country to travel abroad. (4) The unfettered discretion given to the respondents to issue on not to issue a passport to a person offends Article 14 of the Constitution inasmuch as (a) it enables the State to discriminate between persons similarly situated and also because it offends the doctrine of rule of law, (b) the rule of law requires that an executive action which prejudicially affects the rights of a citizen must be pursuant to law. And (5) the said ....
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.... pleasure without a passport, but you would not be allowed by foreign countries to enter them without it and you cannot also come back to India without it". No person in India can possibly travel on those conditions. Indeed it is impossible for him to do so. That apart, even that theoretical possibility of exit is expressly restricted by executive instructions and by refusal of foreign-exchange. We have, therefore, no hesitation to hold that an Indian passport is factually a necessary condition for travel abroad and without it no person residing in India can travel outside India. 12. The want of a passport in effect prevents a person leaving India. Whether we look at it as a facility given to a person to travel abroad or as a request to a foreign country to give the holder diplomatic protection, it cannot be denied that the Indian Government, by refusing a permit to a person residing in India, completely prevents him from travelling abroad. If a person living in India, whether he is a citizen or not, has a right to travel abroad, the Government by withholding the passport can deprive him of his right. Therefore, the real question in these writ petitions is: Whether a perso....
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....sion "liberty" by the 5th and 14th Amendments to the U.S. Constitution and the expression "personal liberty" in Article 21 only excludes the ingredients of "liberty" enshrined in Article 19 of the Constitution. In other words, the expression "personal liberty" in Article 21 takes in the right of locomotion and to travel abroad, but the right to move throughout the territories of India is not covered by it inasmuch as it is specially provided in Article 19. There are conflicting decisions of High Courts on this question. 31. For the reasons mentioned above we would accept the view of Kerala, Bombay and Mysore High Courts in preference to that expressed by the Delhi High Court. It follows that under Article 21 of the Constitution no person can be deprived of his right to travel except according to procedure established by law. It is not disputed that no law was made by the State regulating or depriving persons of such a right. (Emphasis added) 77. This led to the enactment of the Passports Act, 1967 (replacing the earlier act of 1920). It was to govern and control the right to travel abroad, and became the only statutory mechanism for this. But what the precise import ....
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....condition denoted by the words "in the interests of the general public" limiting the exercise of the power is vague and undefined and the power conferred by this provision is, therefore, excessive and suffers from the vice of "over-breadth". The petition also contained a challenge that an order under Section 10(3)(c) impounding a passport could not be made by the Passport Authority without giving an opportunity to the holder of the passport to be heard in defence and since in the present case, the passport was impounded by the Government without affording an opportunity of hearing to the petitioner, the order was null and void, and, in the alternative, if Section 10(3)(c) were read in such a manner as to exclude the right of hearing, the section would be infected with the vice of arbitrariness and it would be void as offending Article 14. These were the only grounds taken in the petition as originally filed and on July 20, 1977 the petition was admitted and rule issued by this Court and an interim order was made directing that the passport of the petitioner should continue to remain deposited with the Registrar of this Court pending the hearing and final disposal of the petition. ....
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....any, as it may consider necessary, shall, by order in writing, issue or refuse to issue the passport or travel document or make or refuse to make on the passport or travel document endorsement in respect of one or more of the foreign countries specified in the application. Sub-section (3) requires the passport authority, where it refuses to issue the passport or travel document or to make any endorsement on the passport or travel document, to record in writing a brief statement of its reasons for making such order. Section 6, sub-section (1) lays down the grounds on which the passport authority shall refuse to make an endorsement for visiting any foreign country and provides that on no other ground the endorsement shall be refused. There are four grounds set out in this sub-section and of them, the last is that, in the opinion of the Central Government, the presence of the applicant in such foreign country is not in the public interest. Similarly sub-section (2) of Section 6 specifies the grounds on which alone - and on no other grounds - the passport authority shall refuse to issue passport or travel document for visiting any foreign country and amongst various grounds set out the....
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....tatement of reasons for impounding the passport of the petitioner on the ground that it was not in the interests of the general public to furnish such copy to the petitioner. It is indeed a matter of regret that the Central Government should have taken up this attitude in reply to the request of the petitioner to be supplied a copy of the statement of reasons, because ultimately, when the petition came to be filed, the Central Government did disclose the reasons in the affidavit in reply to the petition which shows that it was not really contrary to public interest and if we look at the reasons given in the affidavit in reply, it will be clear that no reasonable person could possibly have taken the view that the interests of the general public would be prejudiced by the disclosure of the reasons. This is an instance showing how power conferred on a statutory authority to act in the interests of the general public can sometimes be improperly exercised. If the petitioner had not filed the petition, she would perhaps never have been able to find out what were the reasons for which her passport was impounded and she was deprived of her right to go abroad. The necessity of giving reason....
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.... order impounding the passport of the petitioner. Meaning and content of personal liberty in Article 21 5. It is obvious that Article 21, though couched in negative language, confers the fundamental right to life and personal liberty. So far as the right to personal liberty is concerned, it is ensured by providing that no one shall be deprived of personal liberty except according to procedure prescribed by law. The first question that arises for consideration on the language of Article 21 is: what is the meaning and content of the words "personal liberty" as used in this article? This question incidentally came up for discussion in some of the judgments in A.K. Gopalan v. State of Madras [1950 SCC 228: AIR 1950 SC 27: 1950 SCR 88: 51 Cri LJ 1383] and the observations made by Patanjali Sastri, J., Mukherjea, J., and S.R. Das, J., seemed to place a narrow interpretation on the words "personal liberty" so as to confine the protection of Article 21 to freedom of the person against unlawful detention. But there was no definite pronouncement made on this point since the question before the Court was not so much the interpretation of the words "personal liberty" as the i....
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....ights conferred by Part III are not distinct and mutually exclusive rights. Each freedom has different dimensions and merely because the limits of interference with one freedom are satisfied, the law is not freed from the necessity to meet the challenge of another guaranteed freedom. The decision in A.K. Gopalan case [1950 SCC 228: AIR 1950 SC 27: 1950 SCR 88: 51 Cri LJ 1383] gave rise to the theory that the freedoms under Articles 19, 21, 22 and 31 are exclusive - each article enacting a code relating to the protection of distinct rights, but this theory was overturned in R.C. Cooper case [(1970) 2 SCC 298: (1971) 1 SCR 512] where Shah, J., speaking on behalf of the majority pointed out that "Part III of the Constitution weaves a pattern of guarantees on the texture of basic human rights. The guarantees delimit the protection of those rights in their allotted fields they do not attempt to enunciate distinct rights." The conclusion was summarised in these terms: "In our judgment, the assumption in A.K. Gopalan case [1950 SCC 228: AIR 1950 SC 27: 1950 SCR 88: 51 Cri LJ 1383] that certain articles in the Constitution exclusively deal with specific matters - cannot be accepte....
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....h and ambit of the fundamental rights rather than attenuate their meaning and content by a process of judicial construction. The wavelength for comprehending the scope and ambit of the fundamental rights has been set by this Court in R.C. Cooper case [(1970) 2 SCC 298: (1971) 1 SCR 512] and our approach in the interpretation of the fundamental rights must now be in tune with this wavelength. We may point out even at the cost of repetition that this Court has said in so many terms in R.C. Cooper case [(1970) 2 SCC 298: (1971) 1 SCR 512] that each freedom has different dimensions and there may be overlapping between different fundamental rights and therefore it is not a valid argument to say that the expression "personal liberty" in Article 21 must be so interpreted as to avoid overlapping between that article and Article 19(1). The expression "personal liberty" in Article 21 is of the widest amplitude and it covers a variety of rights which go to constitute the personal liberty of man and some of them have been raised to the status of distinct fundamental rights and given additional protection under Article 19. Now, it has been held by this Court in Satwant Singh case [AIR 1967 SC 1....
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....J., who was in a minority, went to the farthest limit in saying that the procedure must include the four essentials set out in Prof. Willis' book on Constitutional Law, namely, notice, opportunity to be heard, impartial tribunal and ordinary course of procedure. Patanjali Sastri, J., did not go as far as that but he did say that "certain basic principles emerged as the constant factors known to all those procedures and they formed the core of the procedure established by law". Mahajan, J., also observed that Article 21 requires that "there should be some form of proceeding before a person can be condemned either in respect of his life or his liberty" and "it negatives the idea of fantastic, arbitrary and oppressive forms of proceedings". But apart altogether from these observations in A.K. Gopalan case [1950 SCC 228: AIR 1950 SC 27: 1950 SCR 88: 51 Cri LJ 1383] which have great weight, we find that even on principle the concept of reasonableness must be projected in the procedure contemplated by Article 21, having regard to the impact of Article 14 on Article 21. The inter-relationship between Articles 14, 19 and 21 13. Now, here, the power conferred on the Pa....
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....sion empowering an authority to take action is constitutionally valid, action taken under it may offend a fundamental right and in that event, though the statutory provision is valid, the action may be void. Therefore, even though Section 10(3)(c) is valid, the question would always remain whether an order made under it is invalid as contravening a fundamental right. The direct and inevitable effect of an order impounding a passport may, in a given case, be to abridge or take away freedom of speech and expression or the right to carry on a profession and where such is the case, the order would be invalid, unless saved by Article 19(2) or Article 19(6). Take for example, a pilot with international flying licence. International flying is his profession and if his passport is impounded, it would directly interfere with his right to carry on his profession and unless the order can be justified on the ground of public interest under Article 19(6), it would be void as offending Article 19(1)(9). Another example may be taken of an evangelist who has made it a mission of his life to preach his faith to people all over the world and for that purpose, sets up institutions in different countr....
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....neral public and even if it restricts freedom to carry on a profession, it would be protected by Article 19(6). But if an order made under Section 10(3)(c) restricts freedom of speech and expression, it would not be enough that it is made in the interests of the general public. It must fall within the terms of Article 19(2) in order to earn the protection of that article. If it is made in the interests of the sovereignty and integrity of India or in the interests of the security of India or in the interests of friendly relations of India with any foreign country, it would satisfy the requirement of Article 19(2). But if it is made for any other interests of the general public save the interests of "public order, decency or morality", it would not enjoy the protection of Article 19(2). There can be no doubt that the interests of public order, decency or morality are "interests of the general, public" and they would be covered by Section 10(3)(c), but the expression "interests of the general public" is, as already pointed out, a much wider expression and, therefore, in order that an order made under Section 10(3)(c) restricting freedom of speech and expression, may not fall foul of A....
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....er the reasons for its decision, she has filed this writ petition under Article 32 of the Constitution to challenge that order. The challenge is founded on the following grounds: ... At first, the passport authority exercising its power under Section 10(5) of the Act refused to furnish to the petitioner the reasons for which it was considered necessary in the interests of general public to impound her passport. But those reasons were disclosed later in the counter-affidavit filed on behalf of the Government of India in answer to the writ petition. The disclosure made under the stress of the writ petition that the petitioner's passport was impounded because, her presence was likely to be required in connection with the proceedings before a Commission of Inquiry, could easily have been made when the petitioner called upon the Government to let her know the reasons why her passport was impounded. The power to refuse to disclose the reasons for impounding a passport is of an exceptional nature and it ought to be exercised fairly, sparingly and only when fully justified by the exigencies of an uncommon situation. The reasons, if disclosed, being open to judicial scrutiny fo....
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....consent of the community generally. Not any capricious command but reasonable mode ordinarily regarded by the cream of society as dharma or law, approximating broadly to other standard measures regulating criminal or like procedure in the country. Often, it is a legislative act, but it must be functional, not fatuous. 81. This line of logic alone will make the two clauses of Article 21 concordant, the procedural machinery not destroying the substantive fundamentally. The compulsion of constitutional humanism and the assumption of full faith in life and liberty cannot be so futile or fragmentary that any transient legislative majority in tantrums against any minority, by three quick readings of a bill with the requisite quorum, can prescribe any unreasonable modality and thereby sterilise the grandiloquent mandate. "Procedure established by law", with its lethal potentiality, will reduce life and liberty to a precarious plaything if we do not ex necessitate import into those weighty words an adjectival rule of law, civilised in its soul, fair in its heart and fixing those imperatives of procedural protection absent which the processual tail will wag the substantive head. Ca....
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....ty and worth of the individual, will not be entitled to any procedural safeguard save such as a legislature's mood chooses. In Kochuni [Kavalappara Kottarathil Kochuni v. States of Madras and Kerala, AIR 1960 SC 1080, 1093: (1960) 3 SCR 887: (1961) 2 SCJ 443.] the Court, doubting the correctness of the Gopalan decision on this aspect, said: "Had the question been res integra, some of us would have been inclined to agree with the dissenting view expressed by Fazal Ali, J. 86. Gopalan does contain some luscent thought on "procedure established by law". Patanjali Sastri J. approximated it to the prevalent norms of criminal procedure regarded for a long time by Indo-Anglian criminal law as conscionable. The learned Judge observed (SCR pp. 201- 205): "On the other hand, the interpretation suggested by the Attorney-General on behalf of the intervener that the expression means nothing more than procedure prescribed by any law made by a competent legislature is hardly more acceptable. 'Established', according to him, means prescribed, and if Parliament or the Legislature of a State enacted a procedure, however novel and ineffective for affording the a....
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....h made processual law humane. The learned Judge argued: "It seems to me that there is nothing revolutionary in the doctrine that the words 'procedure established by law' must include the four principles set out in Professor Willis' book, which, as I have already stated, are different aspects of the same principles and which have no vagueness or uncertainty about them. These principles, as the learned author points out and as the authorities show, are not absolutely rigid principles but are adaptable to the circumstances of each case within certain limits. I have only to add, that it has not been seriously controverted that 'law' means certain definite rules of proceeding and not something which is a mere pretence for procedure." (emphasis, added) In short, fair adjectival law is the very life of the life-liberty fundamental right (Article 21), not "autocratic supremacy of the legislature". Mahajan, J. struck a concordant note: "Article 21 in my opinion, lays down substantive law as giving protection to life and liberty inasmuch as it says that they cannot be deprived except according to the procedure established by law; in other words, it....
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....stion of the procedure in Article 21, Dr Saraf submits and we believe correctly that the law has advanced from the earlier doubts about 'substantive due process' as originally understood. He invites attention to the Supreme Court decision in KS Puttaswamy v Union of India ('Privacy').[(2017) 10 SCC 1.] But we would do well do step back a bit in the judgment by Dr DY Chandrachud J (as he then was), because from paragraph 273 onwards, that judgment dealt precisely with 'substantive' and 'procedural due process'.[ Section Q, from paragraph 273 of the SCC report.] So too did the concurring opinion of RF Nariman J. [From paragraph 429 of the SCC report.] These precepts are crucial to Dr Saraf's proposition and to a proper appreciation of the issue involved. We will not make so bold as to attempt a summation. We quote the relevant paragraphs. Q. Substantive due process 273. During the course of the hearing, Mr Rakesh Dwivedi, learned Senior Counsel appearing on behalf of the State of Gujarat submitted that the requirement of a valid law with reference to Article 21 is not conditioned by the notion of substantive due process. Substantive due....
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....siness. [Adair v. United States, 1908 SCC OnLine US SC 24: 52 L Ed 436: 28 S Ct 277: 208 US 161 (1908) (Fifth Amendment); Adkins v. Children's Hospital, 1923 SCC OnLine US SC 105: 67 L Ed 785: 43 S Ct 22: 261 US 525 (1923) (Fifth Amendment); Tyson & Bro. v. Banton, 1927 SCC OnLine US SC 63: 71 L Ed 718: 47 S Ct 426: 273 US 418 (1927) and New State Ice Co. v. Liebmann, 1932 SCC OnLine US SC 63: 76 L Ed 747: 52 S Ct 371: 285 US 262 (1932)] These decisions were eventually distinguished or overruled in 1937 and thereafter. [National Labor Relations Board v. Jones & Laughlin Steel Corpn., 1937 SCC OnLine US SC 79: 81 L Ed 893: 301 US 1 (1937); West Coast Hotel Co. v. Parrish, 1937 SCC OnLine US SC 58: 81 L Ed 703: 57 S Ct 578: 300 US 379 (1937)] 279. In Gopalan [A.K. Gopalan v. State of Madras, 1950 SCC 228: AIR 1950 SC 27: 1950 SCR 88], the Preventive Detention Act, 1950 was challenged on the ground that it denied significant procedural safeguards against arbitrary detention. The majority rejected the argument that the expression "procedure established by law" meant procedural due process. Kania, C.J. noted that Article 21 of our Constitution had consciously been drawn up ....
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....n "procedure established by law" simply means any procedure established or enacted by statute it will be difficult to give a negative answer to the question, but if the word "law" includes what I have endeavoured to show it does, such an answer may be justified. It seems to me that there is nothing revolutionary in the doctrine that the words "procedure established by law" must include the four principles set out in Professor Willis' book, which, as I have already stated, are different aspects of the same principle and which have no vagueness or uncertainty about them. These principles, as the learned author points out and as the authorities show, are not absolutely rigid principles but are adaptable to the circumstances of each case within certain limits. I have only to add that it has not been seriously controverted that "law" in this article means valid law and "procedure" means certain definite rules of proceeding and not something which is a mere pretence for procedure." 281. In Maneka [Maneka Gandhi v. Union of India, (1978) 1 SCC 248], where the passport of the petitioner was impounded without furnishing reasons, a majority of the Judges found that the expressio....
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....978) 4 SCC 494: 1979 SCC (Cri) 155], SCC pp. 574-75, para 228) "228. ... The word "law" in the expression "procedure established by law" in Article 21 has been interpreted to mean in Maneka Gandhi case [Maneka Gandhi v. Union of India, (1978) 1 SCC 248] that the law must be right, just and fair and not arbitrary, fanciful or oppressive." Krishna Iyer, J. took note of the fact that our Constitution does not contain a due process clause and opined that after the decision in Maneka [Maneka Gandhi v. Union of India, (1978) 1 SCC 248], the absence of such a clause would make no difference: (SCC p. 518, para 52) "52. True, our Constitution has no "due process" clause or the VIIIth Amendment; but, in this branch of law, after Cooper [Rustom Cavasjee Cooper v. Union of India, (1970) 1 SCC 248] and Maneka Gandhi [Maneka Gandhi v. Union of India, (1978) 1 SCC 248] the consequence is the same." 291. Having noticed this, the evolution of Article 21, since the decision in Cooper [Rustom Cavasjee Cooper v. Union of India, (1970) 1 SCC 248] indicates two major areas of change. First, the fundamental rights are no longer regarded as isolated silos or watertight ....
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....f law-making best understands the needs of society and would not readily be assumed to have transgressed a constitutional limitation. The burden lies on the individual who asserts a constitutional transgression to establish it. Secondly, the courts tread warily in matters of social and economic policy where they singularly lack expertise to make evaluations. Policy-making is entrusted to the State. [R.K. Garg v. Union of India, (1981) 4 SCC 675: 1982 SCC (Tax) 30; Maharashtra State Board of Secondary and Higher Secondary Education v. Paritosh Bhupeshkumar Sheth, (1984) 4 SCC 27: AIR 1984 SC 1543; State of A.P. v. McDowell & Co., (1996) 3 SCC 709; Union of India v. Azadi Bachao Andolan, (2004) 10 SCC 1; State of U.P. v. Jeet S. Bisht, (2007) 6 SCC 586; K.T. Plantation (P) Ltd. v. State of Karnataka, (2011) 9 SCC 1: (2011) 4 SCC (Civ) 414 and Bangalore Development Authority v. Aircraft Employees' Coop. Society Ltd., (2012) 3 SCC 442] 293. The doctrine of separation of powers requires the Court to allow deference to the legislature whose duty it is to frame and enact law and to the executive whose duty it is to enforce law. The Court would not, in the exercise of judicial....
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....80 SCC (Cri) 580] ) and mandatory death sentence (Mithu [Mithu v. State of Punjab, (1983) 2 SCC 277: 1983 SCC (Cri) 405] ), among other cases. A person cannot be deprived of life or personal liberty except in accordance with the procedure established by law. Article 14, as a guarantee against arbitrariness, infuses the entirety of Article 21. The interrelationship between the guarantee against arbitrariness and the protection of life and personal liberty operates in a multi-faceted plane. First, it ensures that the procedure for deprivation must be fair, just and reasonable. Second, Article 14 impacts both the procedure and the expression "law". A law within the meaning of Article 21 must be consistent with the norms of fairness which originate in Article 14. As a matter of principle, once Article 14 has a connect with Article 21, norms of fairness and reasonableness would apply not only to the procedure but to the law as well. 295. Above all, it must be recognised that judicial review is a powerful guarantee against legislative encroachments on life and personal liberty. To cede this right would dilute the importance of the protection granted to life and personal liberty ....
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....l are concerned. Preventive detention, which is dealt with in Article 22, also amounts to deprivation of personal liberty which is referred to in Article 21, and is a violation of the right of freedom of movement dealt with in Article 19(1)(d). That there are other instances of overlapping of articles in the Constitution may be illustrated by reference to Article 19(1)(f) and Article 31 both of which deal with the right to property and to some extent overlap each other." He went on thereafter to hold that the fact that "due process" was not actually used in Article 21 would be of no moment. He said: (AIR pp. 57-58, paras 69-71: SCR pp. 159-61) "69. It will not be out of place to state here in a few words how the Japanese Constitution came into existence. It appears that on 11-10-1945, General MacArthur directed the Japanese Cabinet to initiate measures for the preparation of the Japanese Constitution, but, as no progress was made, it was decided in February 1946, that the problem of constitutional reform should be taken over by the government section of the Supreme Commander's Headquarters. Subsequently the Chief of this section and the staff drafted the Const....
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.... principally in its original status as a restriction upon procedure.' In the circumstances mentioned, it seems permissible to surmise that the expression "procedure established by law" as used in the Japanese Constitution represented the current trend of American judicial opinion with regard to "due process of law", and, if that is so, the expression as used in our Constitution means all that the American writers have read into the words "procedural due process". But I do not wish to base any conclusions upon mere surmise and will try to examine the whole question on its merits. 71. The word "law" may be used in an abstract or concrete sense. Sometimes it is preceded by an article such as "a" or "the" or by such words as "any", "all", etc. and sometimes it is used without any such prefix. But, generally, the word "law" has a wider meaning when used in the abstract sense without being preceded by an article. The question to be decided is whether the word "law" means nothing more than statute law. Now whatever may be the meaning of the expression "due process of law" the word "law" is common to that expression as well as "procedure established by law" a....
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.... We are therefore unable to hold that the challenge to the validity of the provision for acquisition is liable to be tested only on the ground of non-compliance with Article 31(2). Article 31(2) requires that property must be acquired for a public purpose and that it must be acquired under a law with characteristics set out in that Article. Formal compliance with the conditions under Article 31(2) is not sufficient to negative the protection of the guarantee of the right to property. Acquisition must be under the authority of a law and the expression "law" means a law which is within the competence of the legislature, and does not impair the guarantee of the rights in Part III. We are unable, therefore, to agree that Articles 19(1)(f) and 31(2) are mutually exclusive." [fn text: Shri Gopal Sankaranarayanan has argued that the statement contained in R.C. Cooper, (1970) 1 SCC 248 that 5 out of 6 learned Judges had held in Gopalan, 1950 SCC 228: AIR 1950 SC 27 that Article 22 was a complete code and was to be read as such, is incorrect. He referred to various extracts from the judgments in Gopalan, 1950 SCC 228: AIR 1950 SC 27 to demonstrate that this was, in fact, i....
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....dividual, will not be entitled to any procedural safeguard save such as a legislature's mood chooses.' 28. Close on the heels of Maneka Gandhi case [Maneka Gandhi v. Union of India, (1978) 1 SCC 248] came Mithu v. State of Punjab [Mithu v. State of Punjab, (1983) 2 SCC 277: 1983 SCC (Cri) 405], in which case the Court noted as follows: (Mithu case [Mithu v. State of Punjab, (1983) 2 SCC 277: 1983 SCC (Cri) 405], SCC pp. 283-84, para 6) '6. ... In Sunil Batra v. Delhi Admn. [Sunil Batra v. Delhi Admn., (1978) 4 SCC 494: 1979 SCC (Cri) 155], while dealing with the question as to whether a person awaiting death sentence can be kept in solitary confinement, Krishna Iyer, J. said that though our Constitution did not have a "due process" clause as in the American Constitution; the same consequence ensued after the decisions in Bank Nationalisation case [Rustom Cavasjee Cooper v. Union of India, (1970) 1 SCC 248] and Maneka Gandhi case [Maneka Gandhi v. Union of India, (1978) 1 SCC 248] ... In Bachan Singh [Bachan Singh v. State of Punjab, (1980) 2 SCC 684: 1980 SCC (Cri) 580] which upheld the constitutional validity of the death penalty, Sarkaria J., speakin....
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.... to be borne in mind that t the Constitution Framers deliberately avoided in this context the use of the expression "due process" with its comprehensiveness, flexibility and attendant vagueness, in favour of a somewhat more definite word "reasonable", and caution has, therefore, to be exercised before the literal application of American decisions." Mathew, J. in Kesavananda Bharati v. State of Kerala, (1973) 4 SCC 225: 1973 Supp SCR 1 commented on this particular passage thus: (SCC pp. 873-74, para 1695: SCR pp. 824-26) "1695. When a court adjudges that a legislation is bad on the ground that it is an unreasonable restriction, it is drawing the elusive ingredients for its conclusion from several sources. In fact, you measure the reasonableness of a restriction imposed by law by indulging in an authentic bit of special legislation [See Learned Hand, Bill of Rights, p. 26]. 'The words "reason" and "reasonable" denote for the common law lawyer ideas which the "Civilians" and the "Canonists" put under the head of the law of nature.' ... The limitations in Article 19 of the Constitution open the doors to judicial review of legislation in India....
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....nity of hearing. Therefore, in a situation where the order is silent on the material facts, the person aggrieved cannot effectively challenge the same. Resultantly, there exists no effective mechanism to judicially review the same. (See State of Bihar v. Kamla Kant Misra [State of Bihar v. Kamla Kant Misra, (1969) 3 SCC 337] .) In light of the same, it is imperative for the State to make such orders public so as to make the right available under Section 144(5) CrPC a practical reality. (Emphasis added) 83. Anuradha Bhasin also holds that any restriction on fundamental rights must be tested on the principle of proportionality based on the nature of the emergency, and the nature, duration and extent of the restriction; and also whether it is the least restrictive measure possible. 68. In Modern Dental College case [Modern Dental College & Research Centre v. State of M.P., (2016) 7 SCC 353 : 7 SCEC 1], this Court also went on to analyse that the principle of proportionality is inherently embedded in the Indian Constitution under the realm of the doctrine of reasonable restrictions and that the same can be traced under Article 19. ... 69. Thereafter, a comprehen....
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....s earlier judgments, applied German approach while applying proportionality test to the case at hand. We would like to proceed on that very basis which, however, is tempered with more nuanced approach as suggested by Bilchitz. This, in fact, is the amalgam of German and Canadian approach. We feel that the stages, as mentioned in Modern Dental College & Research Centre and recapitulated above, would be the safe method in undertaking this exercise, with focus on the parameters as suggested by Bilchitz, as this projects an ideal approach that need to be adopted." 75. Dr Chandrachud, J., in K.S. Puttaswamy (Aadhaar-5 J.), made observations on the test of proportionality that needs to be satisfied under our Constitution for a violation of the right to privacy to be justified, in the following words : (SCC p. 819, para 1288) "1288. In K.S. Puttaswamy v. Union of India [K.S. Puttaswamy (Privacy-9 J.)], one of us (Chandrachud, J.), speaking for four Judges, laid down the tests that would need to be satisfied under our Constitution for violations of privacy to be justified. This included the test of proportionality: (SCC p. 509, para 325) '325. ... A law which....
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.... The measures must be necessary to achieve the object and must not infringe rights to an extent greater than is necessary to fulfil the aim; 1324.4. Restrictions must not only serve legitimate purposes; they must also be necessary to protect them; and 1324.5. The State must provide sufficient safeguards relating to the storing and protection of centrally stored data. In order to prevent arbitrary or abusive interference with privacy, the State must guarantee that the collection and use of personal information is based on the consent of the individual; that it is authorised by law and that sufficient safeguards exist to ensure that the data is only used for the purpose specified at the time of collection. Ownership of the data must at all times vest in the individual whose data is collected. The individual must have a right of access to the data collected and the discretion to opt out." 77. This is the current state of the doctrine of proportionality as it exists in India, wherein proportionality is the key tool to achieve judicial balance. But many scholars are not agreeable to recognise proportionality equivalent to that of balancing. ... 78. In....
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....fore it is shown that the PSB-induced or triggered LOCs are not in conformity with the requirements of procedural fairness as enunciated by our Supreme Court, the inevitable consequence must be that they cannot be sustained. G. THE SCOPE OF EXECUTIVE POWER UNDER THE CONSTITUTION OF INDIA 86. On the scope of executive power under the Constitution of India, we believe Mr Singh's submissions, the Affidavit in Reply and the written arguments are somewhat off the mark. The reason is that the question is not whether the executive has any power under the Constitution of India, but whether such power that the Constitution of India confers can be used to infringe a fundamental right. 87. The submissions by the Union of India proceed on this basis: that the Constitution of India itself provides for executive power. It is in exercise of this power, and because there is no controlling statute, that the OMs are framed. But the OMs do not per se restrict travel. They are only a framework. Therefore, it is argued, there is no infringement of any fundamental right. 88. As we said, this misses the point almost entirely. The OMs do allow certain agency to request LOCs to be issued. C....
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....standing anything, in this article, continue to exercise in matters with respect to which Parliament has power to make laws for that State such executive power or functions as the State or officer or authority thereof could exercise immediately before the commencement of this Constitution. 77. Conduct of Business of the Government of India (1) All executive action of the Government of India shall be expressed to be taken in the name of the president. (2) Orders and other instruments made and executed in the name of the President shall be authenticated in such manner as may be specified in rues to be made by the President, and the validity of an order or instrument which is so authenticated shall not be called in question on the ground that it is not an order or instrument made or executed by the President. (3) The President shall make rules for the more convenient transaction of the business of the Government of India and for the allocation among Ministers of the said business: SEVENTH SCHEDULE (ARTICLE 246) LIST-I UNION LIST 9. Preventive detention for reasons connected with Defence, Foreign Affairs, or the Security of India; p....
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....ia has powers under the Constitution. (Emphasis added) 94. Indeed they would not. They cannot. At least not under our Constitution. Yet, paragraph 34 of the written submissions says: 34. It is submitted that there is no Parliament made law which deals with issuance of a LOC. Hence, the Executive has in accordance with its wide and extensive power framed the Guidelines for issuance of a LOC by the subject OM. (Emphasis added) 95. As we noted this entirely begs the question about fundamental rights under Article 21 being curtailed by some clandestine procedure in issuing and operating PSB-requested LOCs. This is important in view of the submission by Mr Singh, viz., that it is the responsibility of the originating agency - in this case the PSBs - to ensure compliance with all legal requirements. As far as the Union of India is concerned, therefore, the question is not about LOCs 'generally' or as a class, but whether these particular PSB-driven LOCs conform to the legal mandate. For instance, it may be perfectly legitimate to have a watch-and-report LOC at the instance of Interpol. That can hardly be used as a justification for a deprivation of a right to....
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....d or withdrawn at the whims and caprice of the executive for the party in power. Executive instructions, the Court held, do not carry the same status as a statute. 100. The OMs are ex facie not "law" and are by no stretch of imagination "procedure established by law". It is inconceivable that the OMs - purely executive instructions or a framework or guidelines - can ever curtail the fundamental right to travel abroad. But Mr Singh may be correct in saying that the OMs on their own and per se do nothing in this direction. They are literally inoperable on their own. They only require a process to be followed in getting a LOC issued; and the liability and responsibility for the validity of the LOC rests with the originating agency. But if the OM is not law, nor procedure established by law, then neither is the LOC that is issued under any OM. If that process of issuing the LOC is faulty, or if the LOCs are issued in a manner contrary to the OMs, or worse yet, if the LOCs - not being law, and not being under any 'law' or 'procedure established by law' - infringe fundamental rights, then the LOCs cannot be sustained. 101. The expression 'procedure established b....
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....means that a person affected by administrative, judicial or quasi-judicial action must be heard before a decision is taken. The courts generally favour interpretation of a statutory provision consistent with the principles of natural justice because it is presumed that the statutory authorities do not intend to contravene fundamental rights. Application of the said principles depends on the facts and circumstances of the case, express language and basic scheme of the statute under which the administrative power is exercised, the nature and purpose for which the power is conferred, and the final effect of the exercise of that power. [Union of India v. J.N. Sinha, (1970) 2 SCC 458] 70. In Mangilal v. State of M.P. [(2004) 2 SCC 447 : 2004 SCC (Cri) 1085], a two-Judge Bench of this Court held that the principles of natural justice need to be observed even if the statute is silent in that regard. In other words, a statutory silence should be taken to imply the need to observe the principles of natural justice where substantial rights of parties are affected : (SCC pp. 453-54, para 10) "10. Even if a statute is silent and there are no positive words in the Act or the R....
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....ia of citizens of India and for other persons. The long title says as much in so many words. Under Section 3, no person shall depart from, or attempt to depart from India unless he holds a valid passport or travel document. 107. There are different categories of passports (Section 4). An application must be made for a passport or travel document (Section 5). This may be refused under Section 6. The duration of the passport or travel document is controlled by Section 7. Conditions may attach to passports or travel documents under Section 9. 108. Then Section 10 provides for variation, impounding and revocation of passports and travel documents. It sets out a detailed procedure. 109. Section 10A and 10B were added by the 2002 amendment. Section 10A provides for the suspension of passports or travel documents in certain cases. Section 10B deals with validation of intimations. Sections 10, 10A and 10B read thus: 10. Variation, impounding and revocation of passports and travel documents. - (1) The passport authority may, having regard to the provisions of sub-section (1) of Section 6 or any notification under Section 19, vary or cancel the endorsements on a pa....
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....brought to the notice of the passport authority that a warrant or summons for the appearance, or a warrant for the arrest, of the holder of the passport or travel document has been issued by a court under any law for the time being in force or if an order prohibiting the departure from India of the holder of the passport or other travel document has been made by any such court and the passport authority is satisfied that a warrant or summons has been so issued or an order has been so made. (4) The passport authority may also revoke a passport or travel document on the application of the holder thereof. (5) Where the passport authority makes an order varying or cancelling the endorsements on, or varying the conditions of, a passport or travel document under sub-section (1) or an order impounding or revoking a passport or travel document under sub-section (3), it shall record in writing a brief statement of the reasons for making such order and furnish to the holder of the passport or travel document on demand a copy of the same unless in any case, the passport authority is of the opinion that it will not be in the interests of the sovereignty and integrity of India....
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....e concluded. Provided further that every holder of the passport or travel document, in respect of whom an order under clause (a) or clause (b) of this sub-section had been passed, shall be given an opportunity of being heard within a period of not later than eight weeks reckoned from the date of passing of such order and thereupon the Central Government may, if necessary, by order in writing, modify or revoke the order passed under this sub-section. (2) The designated officer shall immediately communicate the orders passed under sub-section (1), to the concerned authority at an airport or any other point of embarkation or immigration, and to the passport authority. (3) Every authority referred to in sub-section (2) shall, immediately on receipt of the order passed under sub-section (1), give effect to such order. 10-B. Validation of intimation .- Every intimation given by the Central Government or the designated officer, before the commencement of the Passports (Amendment) Act, 2002, to any immigration authority at an airport or any other point of embarkation or immigration, restricting or in any manner prohibiting the departure from India of any holder o....
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....ies were issuing "Look Out Circulars" to prevent such persons from leaving the country." The insertion of Sections 10A and 10B via amendment was intended to pre-empt and prevent random executive intervention in the field. 114. In Suresh Nanda v CBI, [(2008) 3 SCC 674.] the Supreme Court considered whether a passport could be impounded under Section 104 of the CrPC. Recognizing the Passports Act as a "special Act" providing for the impounding of passports, the Court ruled that the special act would prevail over the general act. It held where "there is a special Act dealing with [a] specific subject, resort should be had to that Act instead of [a] general Act providing for the matter connected to the specific Act." 115. In Paluru Ramkrishnaiah & Ors v Union of India & Ors, [(1989) 2 SCC 541.] the Supreme Court held that in the absence of legislative (i.e., statutory) rules, it was open to the government to take a decision in exercise of powers under Article 73 (for the Union Government) or Article 162 (the corresponding provision for the State Government). Specifically, the Supreme Court held: "An executive instruction can make a provision only with regard to a matt....
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....uance of passports and suspension and/or revocation of passports and provisions related thereto. It does not deal with or address aspects pertaining to issuance of a LOC whereby a person can be put on a watchlist or arrested or detained or prevented departure. A LOC as explained earlier is not only limited to preventing departure but encompasses various possible actions. 39. Further, even with respect to preventing departure it may be noted that the provisions of the Passports Act, 1967 authorise a passport authority to impound a passport where he deems it necessary but as explained in the LOC mechanism, such discretion is vested in the Originating Authority since the facts would be to their exclusive knowledge. 121. Mr Singh also submits that prevention from departure from India is not only and always a matter of impounding or suspending a passport. There is an in-between grey zone where travel may legitimately be required to be curtailed but which does not go quite as far as impounding a passport or travel document. This is a situation not covered by the Passports Act. In paragraph 40 of the written submissions, he explains: 40. A LOC may be issued even thoug....
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.... arrival / departure of the subject in such cases. The proforma reasons are also essential. Without these, as clause 8(g) (201 equivalent: clause 6(H)) says the LOC subject cannot be arrested or detained. 124. For convenience, we tabulate these clauses from the 2010 and 2021 OMs below. Sr No 2010 OM 2021 OM 1 8(g) Recourse to LOC is to be taken in cognizable offences under IPC or other penal laws. The details in column IV in the enclosed Proforma regarding 'reason for opening LOC' must invariably be provided without which the subject of an LOC will not be arrested/detained. 6(H) Recourse to LOC is to be taken in cognizable offences under IPC or other penal laws. The details in column IV in the enclosed Proforma regarding 'reason for opening LOC' must invariably be provided without which the subject of an LOC will not be arrested/detained. 2 8(h) In cases where there is no cognizable offence under IPC or other penal laws, the LOC subject cannot be detained/arrested or prevented from leaving the country. The originating agency can only request that they be informed about the arrival/ departure of the subject in such cases. 6(I) In cases where the....
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.... Captain Buddhikota Subha Rao. [1989 Supp (2) SCC 605.] This facet was recognized long ago by the Delhi High Court in Sumer Salkan. 127. He agrees that the cognizable / no cognizable case scenario under clauses 8(g) and 8(h) of the 2010 OM (corresponding to clauses 6(H) and 6(I)) of the 2021 OM) does not arise in the present batch of petitions. What concerns the Petitioners is the exception in paragraph 8(j) of the 2010 OM, considerably expanded in clause 6(L) of the 2021 consolidated OM. It is this that is being invoked by the PSBs. That clause now has five discernible components, viz., if the departure is: 1. detrimental to the sovereignty or security or integrity of India; or 2. detrimental to the bilateral relations with any country; or 3. detrimental to the strategic and/or economic interests of India; or 4. such that if such person is allowed to leave, he may potentially indulge in an act of terrorism or offences against the State; or 5. such that the departure ought not be permitted in the larger public interest at any given point in time. 128. These are not areas covered by the Passports Act. The public sector banks are inv....
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....on should be allowed to be hobbled. Mr Singh therefore submits that the exceptional cases clause is limited and narrowly defined. It is necessary in the larger public interest. Further, the OM does not prescribe how or in what manner a LOC must be issued under clause 8(j) of the 2010 OM (corresponding to Clause 6(L) of the 2021 OM, which is an expansion). The originating agency must exercise its own discretion. If the LOC it requests impinges a fundamental right, it is for the originating agency to explain and defend the measure it sought. 130. Consequently, from any perspective, it is impossible to hold, he submits, that the Passports Act completely occupies the field. 131. Dr Saraf's response is that no provision of the CrPC constitutes, or can ever constitute, the 'statutory legal backing' for the OMs and the LOCs regime. Indeed, the OMs are framed - as the Affidavit in Reply of the Union of India itself says and the OMs themselves say - precisely because there is a legislative vacuum. Neither Section 37 nor Section 41(1) of the CrPC empower anyone to issue a LOC. In any case, those powers are available only to the police. The Chairman, Managing Director or CEO....
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....es in the 2021 consolidated OM. We keep in mind the submission of Mr Singh that this inclusion does not exempt the PSBs or their named officers from compliance with every legal standard. 136. The case of the Petitioners is that this is, pure and simple, a classic case of improper and impermissible classification. There is no logical reason why the public sector banks should be treated as a class apart from other banks, especially when all banks, privately held and those in the public sector are equally regulated by the RBI inter alia under the Banking Regulation Act 1949 and various circulars issued by the RBI (including those relating to wilful defaulters, banking fraud, declaration of non-performing assets and so forth). Dr Saraf points out that it is utterly trivial to demonstrate that this classification is impermissible. There is, first of all, no discernible, let alone stated, nexus between the classification and the purpose sought to be achieved; that is to say, why public sector banks alone should have this authority and not other banks that are also identically controlled and regulated. As he points out, except for State Bank of India, not a single public sector bank is....
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....is suggested that those who borrow from public sector banks are undeserving or not entitled to protection under Part III of the Constitution, then that submission has only to be stated to be rejected. The issue therefore is whether it is permissible to confer this kind of power on one segment of the banking sector without demonstrable and meaningful modes of distinction between others in the banking sector. 141. It is suggested that, at best, this is a case of under-classification; there can, indeed, legitimately be a valid classification with a solitary member of the class. But the reliance on the Supreme Court decision in State of Gujarat v Shri Ambica Mills Ltd [(1974) 4 SCC 656.] is entirely inaccurate. The Supreme Court did not hold, as is being suggested, that all under- inclusion is axiomatically or a priori valid. Indeed, it held the reverse, as we can see from the very paragraphs cited before us: "54. A reasonable classification is one which includes all who are similarly situated and none who are not. The question then is: what does the phrase "similarly situated" mean? The answer to the question is that we must look beyond the classification to the purpose of....
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....its extension to those whom it leaves untouched. [Missouri, K&T Rly v. May, 194 US 267, 269] What, then are the fair reasons for the non-extension? What should the Court when it is faced with a law making an under inclusive classification i areas relating to economic and tax matters? Should it, by its judgment, force the Legislature to chose between action or perfection?" (Emphasis added) 142. But the next portions of Ambica Mills are crucial: 58. The piecemeal approach to a general problem permitted by under-inclusive classifications, appears justified when it is considered that legislative dealing with such problems is usually an experimental matter. It is impossible to tell how successful a particular approach may be, what dislocations might occur, what evasions might develop, what new evils might be generated in the attempt. Administrative expedients must be forged and tested. Legislators, recognising these factors, may wish to proceed cautiously, and courts must allow them to do so. [See Joseph Tussman and Jacobusten Brook, The Equal Protection of the Law, 37 California Rev 341]. 59. Administrative convenience in the collection of unpaid accumulations i....
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.... businesses, or even all related businesses, and in the same way, or, not at all. An effort to strike at a particular economic evil could not be hindered by the necessity of carrying in its wake a train of vexatious, troublesome and expensive regulations covering the whole range of connected or similar enterprises. Equal protection clause rests upon two largely subjective judgments: one as to the relative invidiousness of particular differentiation and the other as to the relative importance of the subject with respect to which equality is sought. [See Cox, "The Supreme Court Foreword", 1965 Term, 80 Harv. Daw Rev. 91-95] 65. The question whether, under Article 14, a classification is reasonable or unreasonable must, in the ultimate analysis depend upon the judicial approach to the problem. The great divide in this area lies in the difference between emphasising the actualities or the abstractions of legislation. The more complicated society becomes, the greater the diversity of its problems and the more does legislation direct itself to the diversities. (Emphasis added) 143. Clearly, the submission on under-inclusion or under- classification is misdirected.....
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....lumes, and consequently a trammelling of Article 21 rights of PSB borrowers may be perfectly all right. That borders on the absurd. 147. But just how many such financial fugitives are there, according to the banks, persons who have 'settled abroad' and therefore present this huge problem to PSBs? Paragraph 3 of Ms Maravarman's note tell us. There are five. That is all. Exactly five: Vijay Mallya, Nirav Modi, Mehul Choksi, Jatin Mehta and "Sandesnas (Sterling Biotech)" (sic; presumably Nitin Sandesara and family). This, we are asked to believe, is such a monumental problem that every single borrower from a PSB, with no regard at all to degree, must be lumped in the class. [The rest of the note is a reproduction of Articles 13, 19 and 21. The note from Mr Shinde does not address the constitutional point meaningfully. It focusses on the individual defaults alleged. Ms Parasnis has presented some authorities.] 148. The remaining question goes totally unanswered. Is it to be assumed or pre-supposed by a court that just because a borrower is travelling abroad therefore he is bound to settle abroad and flee the country? 149. Consequently, on the question of the Articl....
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....opy of the LOC is never given, nor is a cause or reason disclosed. In many cases, the LOCs were disclosed only in these proceedings. II. No oversight mechanism 156. There is no prior oversight mechanism of any kind. The Chairman, Managing Director or Chief Executive Officer of the public sector bank is supposedly sufficiently senior to serve as an adequate check. That can never be. As Dr Saraf points out, the bank is the lender in a transaction in which the person against whom the LOC is issued is a borrower and/or a guarantor. Thus, such a coercive power impinging on the fundamental rights of a person can be exercised against him by a private party who is his opponent in a lis and has the mandate to recover monies from him. This is manifestly arbitrary and in violation of Articles 14 and 21 of the Constitution. 157. Clause 8(k) of the 2010 OM as amended (equivalent to Clause 6(M) of the 2021 OM) provides oversight even for non-police bodies like the NCW and NHRC by requiring them to first approach the police and have the police scrutinise and then make the request themselves after following the procedure prescribed in the OM. Under the Protection of Human Rights Act, 1993....
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.... Prasad; [AIR 1961 SC 293.] State of Rajasthan v Nath Mal & Anr. [AIR 1954 SC 307.] In State of West Bengal v Anwar Ali Sarkar & Ors, [1952 1 SCC 1 : AIR 1952 SC 75.] the Supreme Court specifically held that discretionary power even if conferred by legislation (which the OMs are not), if uncontrolled and unguided would render the legislation itself ultra vires Article 14. It is no answer to say that the executive has unlimited power to delegate. The action itself could not be sustained. 160. Ms Mistry relies, we think with justification, on the decision of the Supreme Court in Dwarka Prasad Laxmi Narain v State of Uttar Pradesh & Ors. [1954 SCR 803.] In paragraphs 9 and 10, the Supreme Court held: 9. The provision contained in Clause 3(1) of the Order that "no person shall stock, sell, store for sale or otherwise utilise or dispose of coal except under a licence granted under this Order" is quite unexceptional as a general provision; in fact, that is the primary object which the Control Order is intended to serve. There are two exceptions engrafted upon this general rule: the first is laid down in sub- clause (2)(a) and to that no objection has been or can be taken. The....
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....es. This safeguard, in our opinion, is hardly effective; for there is no higher authority prescribed in the Order who could examine the propriety of these reasons and revise or review the decision of the subordinate officer. The reasons, therefore, which are required to be recorded are only for the personal or subjective satisfaction of the licensing authority and not for furnishing any remedy to the aggrieved person. It was pointed out and with perfect propriety by Mr Justice Matthews in the well-known American case of Yick Wo v. Hopkins [1886 SCC OnLine US SC 188 : 30 L Ed 220 : 118 US 356 at p. 373 (1886)] that the action or non-action of officers placed in such position may proceed from enmity or prejudice, from partisan zeal or animosity, from favouritism and other improper influences and motives which are easy of concealment and difficult to be detected and exposed, and consequently the injustice capable of being wrought under cover of such unrestricted power becomes apparent to every man, without the necessity of detailed investigation. In our opinion, the provision of Clause 4(3) of the U.P. Coal Control Order must be held to void as imposing an unreasonable restriction upo....
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....al justice control all actions of public authorities by applying rules relating to reasonableness, good faith and justice, equity and good conscience. Natural justice is a part of law which relates to administration of justice. Rules of natural justice are indeed great assurances of justice and fairness. The underlying object of the rules of natural justice is to ensure fundamental liberties and rights of subjects. They thus serve public interest. The golden rule which stands firmly established is that the doctrine of natural justice is not only to secure justice but to prevent miscarriage of justice. 32. The traditional English Law recognised the following two principles of natural justice: "(a) Nemo debet esse judex in propria causa: No man shall be a judge in his own cause, or no man can act as both at the one and the same time-a party or a suitor and also as a Judge, or the deciding authority must be impartial and without bias; and (b) Audi alteram partem: Hear the other side, or both the sides must be heard, or no man should be condemned unheard, or that there must be fairness on the part of the deciding authority." However, over the years, ....
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....mate action/order/decision. 50. It is, of course, clear that any direct pecuniary or proprietary interest in the subject-matter of a proceeding, however small, operates as an automatic disqualification. In such a case the law assumes bias. What interest short of that will suffice? 57. It is, thus, evident that the English courts have applied different tests for deciding whether non-pecuniary bias would vitiate judicial or quasi-judicial decision. Many Judges have laid down and applied the "real likelihood" formula, holding that the test for disqualification is whether the facts, as assessed by the court, give rise to a real likelihood of bias. Other Judges have employed a "reasonable suspicion" test, emphasising that justice must be seen to be done, and that no person should adjudicate in any way if it might reasonably be thought that he ought not to act because of some personal interest. 62. In India, the courts have, by and large, applied the "real likelihood test" for deciding whether a particular decision of the judicial or quasi-judicial body is vitiated due to bias. In Manak Lal v. Dr. Prem Chand Singhvi [AIR 1957 SC 425] it was observed: (AIR p. 42....
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....om the materials ascertained by the complaining party, but also from such other facts which it could have readily ascertained and easily verified by making reasonable inquiries. (Emphasis added) 165. The fact that the public sector bank is directly concerned with the recovery of debt and is yet armed with this unilateral power only makes matters worse. As we have seen, in Rajesh Aggarwal, the Supreme Court specifically noted, inter alia, that the principles of audi alteram partem would be read into any processual system that affected civil rights. But these are fundamental rights; and the right to Article 21 cannot be abrogated in this fashion. Here, the public sector bank becomes judge and executioner at once. The canon of nemo judex in causa sua is automatically violated. V. No demonstrated nexus to the purpose sought to be achieved 166. Not once have we been shown that preventing anyone travelling abroad has even remotely addressed the issue - viz., that debt has been recovered because the person has been denied permission to travel. Indeed, carried further there is no reason on this logic why a person should simply be prevented from travelling overseas. Even if it w....
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....t lay within the powers of the authority. ... In another, it is taking into consideration extraneous matters. It is unreasonable that it might almost be described as being done in bad faith; and in fact, all these things run into one another." ... " ... it must be proved to be unreasonable in the sense that the court considers it to be a decision that no reasonable body can come to. It is not what the court considers unreasonable. ... The effect of the legislation is not to set up the court as an arbiter of the correctness of one view over another." (Emphasis added) 170. In CCSU, Diplock LJ for the House of Lords spoke of 'irrationality' in these words: By 'irrationality' I mean what can by now be succinctly referred to as Wednesbury unreasonableness. It applies to a decision which is so outrageous in its defiance of logic or accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it. (Emphasis added) 171. Even as Wednesbury unreasonableness continued to inform decisions of Courts with the power of judicial review, not only here but in many other jurisdiction....
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....operative Bank v Coimbatore District Central Cooperative Bank Employees Association & Anr. [(2007) 4 SCC 669.] The Supreme Court said: 17. So far as the doctrine of proportionality is concerned, there is no gainsaying that the said doctrine has not only arrived in our legal system but has come to stay. With the rapid growth of administrative law and the need and necessity to control possible abuse of discretionary powers by various administrative authorities, certain principles have been evolved by courts. If an action taken by any authority is contrary to law, improper, irrational or otherwise unreasonable, a court of law can interfere with such action by exercising power of judicial review. One of such modes of exercising power, known to law is the "doctrine of proportionality". 18. "Proportionality" is a principle where the court is concerned with the process, method or manner in which the decision-maker has ordered his priorities, reached a conclusion or arrived at a decision. The very essence of decision-making consists in the attribution of relative importance to the factors and considerations in the case. The doctrine of proportionality thus steps in focus ....
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....ity will speak to, as the Supreme Court said in All India Recruitment Board, examining if the decision achieves the required balance. In a complete analysis, the Supreme Court held: Wednesbury and Proportionality 36. Wednesbury [Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn., (1948) 1 KB 223 : (1947) 2 All ER 680 (CA)] applies to a decision which is so reprehensible in its defiance of logic or of accepted moral or ethical standards that no sensible person who had applied his mind to the issue to be decided could have arrived at it. Proportionality as a legal test is capable of being more precise and fastidious than a reasonableness test as well as requiring a more intrusive review of a decision made by a public authority which requires the courts to "assess the balance or equation" struck by the decision-maker. Proportionality test in some jurisdictions is also described as the "least injurious means" or "minimal impairment" test so as to safeguard the fundamental rights of citizens and to ensure a fair balance between individual rights and public interest. Suffice it to say that there has been an overlapping of all these tests in its content and s....
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....est to the three alternatives suggested. Principle of proportionality, as we have already indicated, is more concerned with the aims of the decision-maker and whether the decision-maker has achieved the correct balance. The proportionality test may require the attention of the court to be directed to the relative weight according to interest and considerations. When we apply that test and look at the three alternatives, we are of the view that the decision-maker has struck a correct balance in accepting the second alternative. The first alternative was not accepted not only because such a process was time-consuming and expensive, but nobody favoured that option, and even the candidates who had approached the court were more in favour of the second alternative. Applying the proportionality test also in our view the Board has struck the correct balance in adopting the second alternative which was well balanced and harmonious. 43. We, therefore hold, applying the test of Wednesbury unreasonableness as well as the proportionality test, the decision taken by the Board in the facts and circumstances of this case was fair, reasonable, well balanced and harmonious. By accepting th....
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....of Gujarat v Manoharlal Jitamalji Porwal; [(1987) 2 SCC 364.] State of Maharashtra v Vikram Anantrai Doshi, [(2014) 15 SCC 29.]). But not one of the judgments relied on by Mr Singh or any of the advocates for the banks tells us that a fundamental right can be curtailed or violated in pursuit of this objective. If a fundamental right under say Article 19 is to be constrained, the restriction must fit exactly within Articles 19(2) to 19(6). Restrictions are narrow and limited; freedoms are not. They are, indeed, infinitely elastic, and nothing demonstrates this better than the steady expansion of the ambit of Article 21 over the last six or seven decades. [The reliance on Ajay Canu v Union of India, (1988) 4 SCC 156, is very odd. The challenge there was to a rule requiring two-wheeler drives to wear a helmet. This was assailed as being against some fundamental right. That is hardly comparable with a case of deprivation of a facet of personal liberty.] 182. We state this plainly as our understanding of the law: no amount of 'public interest' can substitute for a 'procedure established by law', i.e., by a statute, statutory rule or statutory regulation in the matter ....
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....t of criminal proceedings or sometimes during the pendency of such proceedings. The absence of such offenders from Indian courts has several deleterious consequences, such as, it obstructs investigation in criminal cases, it wastes precious time of courts and it undermines the rule of law in India. Further, most of such cases of economic offences involve non-repayment of bank loans thereby worsening the financial health of the banking sector in India. The existing civil and criminal provisions in law are inadequate to deal with the severity of the problem. 2. In order to address the said problem and lay down measures to deter economic offenders from evading the process of Indian law by remaining outside the jurisdiction of Indian courts, it is proposed to enact a legislation, namely, the Fugitive Economic Offenders Bill, 2018, to ensure that fugitive economic offenders return to India to face the action in accordance with law. 3. The said Bill, inter alia, provides for: (i) the definition of the fugitive economic offender as an individual who has committed a scheduled offence or offences involving an amount of one hundred crore rupees or more and has absc....
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....0 and 11). None of these basic requirements are to be found in the OMs or the so-called procedure (there is none) followed in PSB-triggered LOCs. 192. This Act on its own negates the entire justification for the PSB- driven LOCs. It upends every argument in defence, including that of 'larger public interest' and the 'economic interests of India'. Notably the SOR does not speak of the 'economic interests of India'. It restricts itself to the 'financial health of the banking sector' - quite correctly - and observes that this is adversely affected by non- repayment of bank loans. But that is precisely the justification and only justification for the issuance of the LOCs. IX. Rival Judgments of High Courts on LOCs Both sides have relied on a catena of judgments of various High Courts regarding LOCs. Little is gained by a more elaborate study of these, as they are all fact dependent. K. CLAUSE 6(J) OF THE 2021 CONSOLIDATED OM 193. We do not think this question need detain us for too long. Earlier, the OMs said that LOCs had a limited 'shelf-life'; they expired after one year. Now they continue until cancelled. This may be nothing mo....
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....o continue until cancelled instead of providing a fixed term for them? No VII Are the impugned LOCs- (i) ultra vires the OMs; Does not arise (ii) ultra vires Articles 14 and 21 of the Constitution of India (including for infringing a fundamental right except according to a procedure established by law; and a failure to abide by mandated minimum procedural norms; unreasonableness; arbitrariness; want of proportionality), and Yes (iii) Arbitrary, unreasonable and disproportionate in equating the financial interest of a public sector bank with the "the economic interests of India". Does not require to be decided. 195. Consequently: (a) Clause 8(b)(xv) of the 2010 amended OM (equivalent to Clause 6(B)(xv) of the 2021 consolidated OM) which includes the Chairmen, Managing Directors and Chief Executive Officers of all public sector banks as authorities who may request the issuance of a Look Out Circular is quashed. (b) All the LOCs are quashed and set aside. (c) The Bureau of Immigration will ignore and not act upon any LOCs issued by any public sector banks. All databases will be updated accordingly. We do not e....